What has Candidate Romney proposed?


There’s little sign that the Times cares: It’s astounding to see the way the press corps has covered this White House campaign—a campaign we’d call “post-information.”

We’re especially struck by the virtual absence of discussion of major policy proposals. Consider the policy proposal which popped at last week’s debate—Mitt Romney’s seven-month-old tax proposal.

(Obama kept saying eighteen months. That was wrong, but whatever.)

One day after the debate, the New York Times swung into action, at least in its later editions. In a fact-check feature which skipped Romney’s howler concerning preconditions, Annie Lowrey gave this description of his tax proposal:
LOWREY (10/4/12): Mr. Obama and Mr. Romney repeatedly sparred over whether Mr. Romney has proposed a $5 trillion tax cut.

It is true that Mr. Romney has proposed ''revenue neutral'' tax reform, meaning that he would not expand the deficit. However, he has proposed cutting all marginal tax rates by 20 percent—which would in and of itself cut tax revenue by $5 trillion.

To make up that revenue, Mr. Romney has said he wants to clear out the underbrush of deductions and loopholes in the tax code. But he has not yet specified how he would do so.
According to Lowrey, that reduction in tax rates “would in and of itself” cut revenues by $5 trillion. She didn’t bother telling readers what time frame she was discussing.

People! It’s the New York Times! How many facts do you need?

Whatever! Lowrey was talking about the next ten years, a point some readers might have known. But uh-oh! One day later, the Washington Post wrote an editorial criticizing Romney’s tax plan.

They had a different account of that $5 trillion price tag:
WASHINGTON POST EDITORIAL (10/5/12): To understand that harsh assessment, you have to spend a few minutes with some facts that Mr. Romney did his best to obscure Wednesday.

"First of all, I don't have a $5 trillion tax cut," he said.

In fact, Mr. Romney has proposed lowering income tax rates, abolishing the estate tax and making other changes that would cost $5 trillion over 10 years. When he says he has no such plan, he means that he intends to make up for the lost revenue by closing loopholes—what's benignly known as "broadening the base." Moreover, he says he can close so many loopholes for rich people that the middle class will end up paying less.

But even if you close every rich person's loophole, you don't save enough money to do everything Mr. Romney wants to do. The Republican cites studies that he says prove that wrong, but when you look closely, they prove him wrong.
Uh-oh! According to the Post, it isn’t the cut in tax rates “in and of itself” which produces that $5 trillion revenue loss. It’s the cut in tax rates plus the abolition of the estate tax plus “other changes.”

Which newspaper is right? No, it doesn’t exactly matter. If anything has become clear during this clownish campaign, it’s this: At best, our major news organizations only pretend to talk about policy proposals.

In truth, there has been little real attempt to examine Romney’s tax proposals. Example:

In August, the Tax Policy Center released a study of Romney’s proposal to cut tax rates. It said his proposal is “mathematically impossible.”

As we noted at the time (and later), the Post and the Times barely reported this seminal matter. In the news divisions of our biggest newspapers, policy no longer matters. At the Times, Saturday Night Live gets the front page. Mitt Romney’s plan is for squares.

That said, which newspaper is right? The Washington Post has repeatedly contradicted Lowrey’s account. This was Lori Montgomery, two days post-debate:
MONTGOMERY (10/5/12): Romney's plan calls for cutting income tax rates by 20 percent for people at all income levels, repealing the estate tax and the alternative minimum tax, and wiping out capital gains taxes for middle-class families.

Those cuts would drain nearly $5 trillion out of the Treasury over the next decade, according to budget analysts. Romney has vowed to replace the lost revenue by scaling back "loopholes and deductions," but he has declined to say which ones.
According to Montgomery, Romney’s proposals reach $5 trillion if you include “repealing the estate tax and the alternative minimum tax, and wiping out capital gains taxes for middle-class families.” Lowrey said the cut in tax rates gets us to that large number all by itself.

Over the weekend, we found no other reporting in the Times which defined things one way or the other.

Who’s right? We agree—within our floundering, failing culture, such questions simply don’t matter. But which account is right? And by the way: Did Romney say he would balance the revenue lost to the rate cuts alone? Or did he say he would balance the revenue lost by all his proposals, including repeal of the estate tax?

(Repeal of the estate tax? Who knows about that! Have you seen your big newspapers discuss that proposal at all?)

One day post-debate, Politifact agreed with the Post’s account. The site offered this analysis:
POLITIFACT (10/4/12): Obama has talked about the $5 trillion tax cut for months. We have looked at this claim before and found it lacked important context. Here's why.

The claim is based on a study done by the Tax Policy Center, a nonpartisan group that has analyzed the tax plans of the candidates. The center examined Romney's proposals for a 20 percent reduction in all federal income tax rates, eliminating the Alternative Minimum Tax, eliminating the estate tax and other tax reductions.

The center estimated that altogether, the lost revenues would total $480 billion by 2015. The Obama campaign adds up the cost over a decade and winds up with $4.8 trillion, which it then rounds up to $5 trillion.
Once again, this would make Lowrey wrong. Politifact linked its claim to a study by the Tax Policy Center, a study done in March.

If you care, you can click the link at Politifact and read that study yourself. In that way, you can discern if the New York Times is right.

The New York Times cares about dogs on the roof. It puts Big Bird on the front page, along with Ann Romney's dressage. But what’s the story with Mitt Romney’s tax proposals?

People! Tax plans are hard!

Tomorrow, we’ll see what happened when the Times finally discussed the Romney tax plan in the wake of that damning study from early August. Lowrey wrote the report on September 10.

For murk, gloam and mire, just click here.

1 comment:

  1. Courtesy of DeLong:


    Arithmetic is not just optimal. Arithmetic is prohibited:

    Paul Ryan says that cutting tax rates by 1/5 is non-negotiable--that even if Congress does not eliminate a single deduction, the Ryan-Romney administration will cut tax rates by 1/5.

    Cutting tax rates by 1/5 boosts the national debt in a decade by $5 trillion plus interest.

    Mitt Romney has, by now, said pretty much everything it is possible to say about the place of the 1/5 tax rate cut--from claiming that he will not cut tax rates at all if Congress won't eliminate deductions, to claiming that the tax rate cut will pay for itself through faster economic growth without any cuts in deductions.

    Paul Ryan has at least a consistent message.

    Families making over $200,000/year will over the next decade receive $1.7 trillion in non-savings deductions: health insurance, home mortgages, charitable contributions, etc.

    Families making over $200,000/year would over the next decade receive $2.7 trillion from Romney's 1/5 rate cut.

    Even were Congress to eliminate all non-savings deductions, families making over $200,000/year would get a $1 trillion tax cut from Romney.

    By arithmetic, if Romney keeps his promise to make his tax cut for the rich revenue-neutral, households making less than $200,000/year would get a $1 trillion or more tax increase--more if the over $200,000/year crowd retain any of their deductions at all.

    Romney has by now promised not just to leave savings deductions untouched and to implement his 1/5 tax rate cut but also to make the plan as a whole revenue neutral and to not lower taxes on the "rich": it just cannot be done.

    Romney claimed six studies support him. Romney lied. Romney's six are:

    Alex Brill says Romney would have to raise taxes on life insurance policies and state and local bonds--thus breaking Romney's commitment not to tax savings--eliminate all deductions for the $200,000/year plus crowd, and still not be revenue neutral: Brill ha to add a Medicare and an economic growth magic asterisk.

    John Diamond says that you could write a plan that would be revenue neutral, but he doesn't have enough information to model Romney's plan.

    Martin Feldstein says that Romney could pay for it if he retains the Estate Tax--which Romney has promised to eliminate--and massively raises taxes on all households making between $100,000/year and $200,000/year by eliminating all of their deductions as well.

    Harvey Rosen also says that Romney could pay for it if he retains the Estate Tax--which Romney has promised to eliminate--and massively raises taxes on all households making between $100,000/year and $200,000/year by eliminating all of their deductions as well.

    Two Wall Street Journal op-eds that contain no analysis whatsoever.
    Thus there are only four studies on Romney's list, and none of them say what he claims they say.

    You're welcome, Bob.